President Donald Trump, who has never made a deal he couldn’t get out of, has nothing on
Las Vegan Howard Bulloch.
With the help of Aspen Financial, a now-defunct hard money lending brokerage that was
owned by Jeff Guinn, the son of former Nevada Governor Kenny Guinn, Bulloch engaged in
serial refinancing of an old motel property across the street from the Mandalay Bay until
Aspen could no longer fund a loan big enough to cover the old loan and new payments.
Despite no improvements to the old motel, Aspen Financial refinanced Bulloch’s “Desert
Land” loan five times, from an initial $10 million in 2001 to just shy of $26 million in
The FBI’s file on Aspen Financial, which I recently obtained, reveals Desert Land was one
of the loans that caught the feds’ attention. (See below) A federal grand jury did not
return an indictment in the case.
Bulloch hasn’t made a payment to some 450 individual investors in the loan in almost a
decade. But with the help of Jeff Guinn and some crafty lawyering to avoid foreclosure or
having to satisfy his personal guarantee, Bulloch still owns the land securing the debt. The
amount owed today is estimated in court documents at $50 million.
Bulloch’s failed Sky-Vue Observation Wheel, which was slated for acreage next to the old
motel, never got off the ground. Now, sensing a market for Strip frontage, Bulloch is
looking to cut the ties that bind him to the Desert Land lenders and the crushing debt he
amassed on the property so that he may market it with the adjacent Sky-Vue land.
If he’s successful, it could spell the end of Nevada’s controversial hard money lending
Last year Bulloch, with the help of Guinn, began soliciting shares of the Desert Land loan
at a deep discount from some of those investors who haven’t seen a dime in almost a
Through a corporate entity, Bulloch and his partner David Gaffin, offered to purchase
investors’ fractional interest in the loan for 25 cents on the dollar. Some who balked were
offered slightly more. Jeff Guinn pitched one investor by noting that his mother, former
First Lady Dema Guinn who was owed $700,000, took the deal.
Bulloch claims he owns more than 51 percent of the loan, and under Nevada law has the
right to eliminate the investors’ interest and his own personal guarantee, which Guinn
But not all of the hundreds of investors who loaned Bulloch the $26 million are willing to
let him off the hook and they’ve gone to court to stop him.
Plaintiffs’ attorney Michael Feder wrote in court pleadings last September that Bulloch’s
effort distorts the intent of the law.
“After a number of years of being in default, the borrowers and guarantors on the subject
loan concocted a scheme whereby they created a single purpose limited liability company
– Acquisition – to purchase, at a substantial discount, enough interest in the subject loan
to control more than the 51% of the Loan’s outstanding beneficial interests. … This
insider- oriented transaction tramples on the minority interest holders’ rights and wholly
disregards Acquisition’s fiduciary obligation to operate in good faith when acting on
behalf of all of the beneficial interest holders. ….Rather than use the statute to allow
lenders to pursue remedies against borrowers, Defendants are attempting to use this
lender-focused statute in an effort to deprive lenders of their legitimate interests in the
Loan. … Taken to its extreme, a borrower could simply use the initial loan proceeds to
purchase back 51% of the loan interest and then simple decide, supposedly on behalf of all
lenders, that the entirety of the Loan would be forgiven and all remaining liabilities would
be extinguished. This perverse outcome would severely hinder economic growth in this
state and would work a grave injustice on the businesses and citizens of this State.”
Bulloch has the legal help of attorney Mark Hutchison, who moonlights as Nevada’s Lt.
Governor and knows a little something about legislative intent. Hutchison was a member
of the 2009 Nevada Legislature, which passed the law in question.
Hutchison not only represents Bulloch but also once represented Aspen in forming trusts
that some investors claim made it easier for Guinn to call the shots on defaulted loans, to
the benefit of himself and selective borrowers and to the detriment of lenders.
I emailed Hutchison on December 28, 2016, asking to talk with him about his
representation of both Guinn and Bulloch, but he did not respond.
Ten days later he announced he would not run for Governor in 2018.
Coincidentally, Hutchison got his start in state government as a member of the Nevada
Ethics Commission, appointed by then-Governor Kenny Guinn. He even briefly changed
his party affiliation to comply with qualifications for the post.
Judge Elizabeth Gonzalez will hear a motion to dismiss the case on April 10th. Gonzalez is a
Guinn-appointee to the bench who has previously fought efforts to remove her from cases
involving Jeff Guinn and Aspen Financial.
Jeff Guinn is awaiting a federal judge’s ruling in a bankruptcy fraud trial stemming from
his dealings at Aspen Financial.
Disclosure: In 2015 and 2016 I did investigative work for an attorney involved in litigation against Jeff Guinn. That work led to discoveries which are included in my upcoming book on Jeff and Kenny Guinn, The Anointed Son: A True Story of Greed, Power and Blind Trust